Asian stocks fall further amid oil market turmoil

Benchmarks in Tokyo, Hong Kong and Southeast Asia retreated.

BEIJING (AP) — Asian stock markets fell further Wednesday as oil prices recovered some of their record-setting losses amid anxiety about the coronavirus pandemic’s mounting economic damage.

Benchmarks in Tokyo, Hong Kong and Southeast Asia retreated while Shanghai was little-changed after Wall Street suffered its biggest decline in weeks.

Benchmark U.S. crude slipped but still was near this week’s all-time low. Brent crude, the international standard, retreated further. The fall has rattled investors because it adds to evidence of the depth of a global economic downturn with factories idled and consumers ordered to stay home.

The plunge in oil prices “has stirred wider concerns of a sharp economic slowdown,” Hayaki Narita of Mizuho Bank said in a report.

Global oil demand is set to drop to levels last seen in the mid-1990s. Producers can’t slow their production fast enough. Storage tanks are running out of room.

Tokyo’s Nikkei 225 fell 1.2% to 19,050.33 and Hong Kong’s Hang Seng was down 0.7% at 23,626.04. The Shanghai Composite Index was off 2 points at 2,824.91.

The Kospi in Seoul tumbled 1% to 1,861.04 and Sydney’s S&P-ASX 200 lost 0.7% to 5,185.10.

New Zealand’s main index fell 1.4% and Singapore was down 1.3%.

The price of a barrel of the benchmark grade of U.S. oil to be delivered in June lost 23 cents to $12.34 in electronic trading on the New York Mercantile Exchange. It plunged 43% the previous session to $11.57.

On Monday, the price of a U.S. barrel to be delivered next month fell to below zero. That meant traders were paying others to take it off their hands so they wouldn’t need to find places to store the swelling surplus.

The price for oil to be delivered in June didn’t hit zero, partly because storage isn’t as pressing a problem.

Brent crude, the price standard for international oils, lost another 76 cents to $18.57 per barrel in London. On Tuesday, it fell 24.4% to $19.33.

“Global markets are struggling mightily with a temporary but overwhelming demand drop,” said Stephen Innes of AxiCorp in a report. He said the June contract also could “fall prey to storage infrastructure saturation.”

On Wall Street, the benchmark S&P 500 fell 3.1% to 2,736.56.

Some 94% of stocks in the index declined. That included winners in the new stuck-at-home economy. Netflix slipped 0.8% before it announced its quarterly results that included a 23% rise in global memberships.

The Dow Jones Industrial Average fell 2.7% to 23,018.88. The Nasdaq was of 3.5% to 8,263.23.

Treasury yields fell further, indicating investors were shifting more money into bonds as a safe haven. The yield, or the difference between the market price and what a buyer will receive if the bond is held to maturity, on the 10-year Treasury dropped to 0.55% from 0.62% late Monday.

Also Tuesday, the U.S. Senate approved a virus aid bill worth nearly $500 billion. It would provide more loans to small businesses and aid to hospitals.

Georgia’s governor, meanwhile, announced plans late Monday to allow gyms, hair salons and other businesses to reopen as early as Friday.

Still, economic data are bleak. A report Tuesday showed the steepest drop for U.S. sales of previously occupied homes since 2015.

Pessimists say the market’s rally has been overdone and that a premature reopening of the economy could lead to only more flareups of infections.

The dollar gained to 107.75 yen from Tuesday’s 107.68 yen. The euro was unchanged at $1.0853.